Trustee Terms

Terms of Engagement – MGH Trustee

 

These terms of engagement (Terms) apply if a trustee company used by Malloy Goodwin Harford acts as a trustee of a trust or a Partner of Malloy Goodwin Harford acts as a trustee of a trust (MGH Trustee, we, us) and govern the relationship between us as a trustee and you as the other trustees of the trust (you).

 

  1. MGH Trustee: The MGH Trustee will act as a trustee of the trust and perform its duties as a trustee in accordance with applicable law.  Our role as a trustee does not extend to the provision of Excluded Services (as defined in Malloy Goodwin Harford’s terms of engagement – see https://mghlaw.co.nz/terms)
  2. Your duties: You must comply with your duties as a trustee of the trust under applicable law.  All decisions relating to the trust must be made unanimously by the trustees (including the MGH Trustee) and the MGH Trustee must be involved in all decision making of the trust including before the trust enters into any contract or agrees to incur any liability.
  3. Information and documents: You must notify us of any proposed change in trustee of the trust in advance of the change being made and follow our directions as to the steps and documents required to effect any change of trustee.  You must also notify us where any trustee or beneficiary becomes resident offshore.  You must supply to the MGH Trustee on request all information and documents in your possession or control relating to the trust and answer any questions we may have of you from time to time relating to the trust including, without limitation, information concerning any trustee or beneficiary (including any trustee or  beneficiary resident offshore). You agree that you will provide information that is true, accurate and not misleading and advise us if you become aware that any document or information previously provided is inaccurate or incomplete.  We will not be required to verify the accuracy or completeness of any information that you provide, and we will be entitled to rely on that information.  The MGH Trustee may retain copies of any documents that we consider necessary to comply with our legal obligations (including after any resignation as a trustee).
  4. Review of activities and assets: You must participate in a review of the trust at reasonable intervals including the trust’s activities, income, expenses, assets and liabilities and the factors relevant to whether basic trust information should be made available to beneficiaries.  It will be your responsibility to contact the MGH Trustee to arrange the initial review meeting.  Further meetings will be agreed with you after the initial meeting, provided that the MGH Trustee reserves the right to require any meeting on reasonable notice which you will be obliged to attend.
  5. Bank accounts: If the trust operates a bank account, that bank account may only be used for transactions relating to the trust and may not be used for any other transactions.  Any withdrawals from the trust’s bank account must be authorised by the MGH Trustee prior to the withdrawal being made and you must on request allow the MGH Trustee to become a joint signatory of any trust bank account and be granted electronic access to monitor trust income, expenditure and funds movements.
  6. Annual accounts: Unless the trustees of the trust unanimously agree, you must arrange for financial accounts to be prepared annually for the trust by a suitably experienced accountant satisfactory to the trustees.  The financial accounts must be prepared and provided to each of the trustees for their review and approval following the end of the trust’s financial year.  All transactions of the trust must be accounted for in financial accounts.
  7. Tax and other responsibilities: You must ensure that the tax obligations of the trust are complied with at all times including, without limitation, preparation of tax returns and payment of all taxes including trustee and beneficiary tax liability.  You must also pay all rates and levies relating to trust property and insure all trust assets in a manner commensurate with the value of such assets.
  8. Guarantees: If the trust has guaranteed personal borrowings (or the borrowings of a company, trust or other entity associated with you), you must ensure that no further money is borrowed without the prior agreement of all trustees of the trust, including the MGH Trustee.
  9. Fees: You must pay our fees and disbursements for our role as a trustee of the trust.  Our fees will be calculated and invoiced in accordance with Malloy Goodwin Harford’s terms of engagement (see https://mghlaw.co.nz/terms) and such fee and payment terms are deemed to be incorporated into these Terms.
  10. Compliance with laws: We must comply with our obligations under all laws binding on us, including anti-money laundering and countering financing of terrorism laws and laws relating to tax reporting and withholdings.  In order to do so, we may be required to conduct customer due diligence on you, persons acting on your behalf, and other relevant persons such as your beneficial owners or persons who have effective control.  We may not be able to continue as a trustee until this is completed.  We may also be required to verify the source of wealth and source of funds where enhanced due diligence is required.  You authorise us to collect this information from your accountants, investment advisers and banks.
  11. Disclosure: We may be required to provide information about you, persons acting on your behalf, and other relevant persons as described in clause 10 above to government agencies.   We may not be permitted to tell you or such persons if we do provide such information.  We may also be required to provide such information to banks with which we place the trust’s funds through our trust account.  Information provided to banks may in turn be passed on by banks to tax and other regulatory authorities in New Zealand and offshore.  You must ensure that any of the persons described above in respect of whom we collect information are aware of and consent to this.
  12. Resignation: You may by notice in writing to us request the resignation of the MGH Trustee at any time.  We may also by notice in writing at any time resign as a trustee of the trust including, without limitation, if at any time we believe (in our absolute discretion) that these Terms have not been fully complied with, our involvement with your trust exposes the MGH Trustee, any MGH Person (as defined below) or any other person associated with Malloy Goodwin Harford to undue risk, loss or liability or we consider we are unable to properly fulfil our legal responsibilities and obligations as a trustee of the trust (including because you no longer use Malloy Goodwin Harford to provide you with legal services).
  13. Post resignation steps: You must pay our fees and disbursements for our attendances in respect of any resignation by us as a trustee and the transfer of trust assets to the continuing trustees and execute and deliver all documents and do all things necessary to confirm our resignation as a trustee.  You must also notify the Inland Revenue Department of our resignation as a trustee.  Upon any resignation under this clause the MGH Trustee shall cease to be a trustee to all intents and purposes except as to the acts and deeds necessary for the proper vesting of the trust property in the continuing or new trustee or trustees or otherwise (as the case may require).
  14. Indemnity: The settlors of the trust hereby indemnify the MGH Trustee (and in the case of a trustee company its directors and shareholder, whether current or former, together with the partners and employees of Malloy Goodwin Harford) (each an MGH Person) and will keep each MGH Person indemnified from and against any and all loss, damage or liability suffered or incurred, legal fees and costs and any claims for payment on behalf of the trust suffered, incurred by or claimed against the MGH Person in the course of the MGH Trustee acting as a trustee (or following any resignation as trustee).
  15. Exclusion: No MGH Person will have any liability for any errors, deficiencies or omissions in any work performed as part of the services that arise as a result of inaccurate or incomplete information provided to us.  In no event will any MGH Person be liable for any indirect or consequential loss or for any loss of profit or loss of opportunity arising out of or relating to a breach of these Terms or any trusteeship.  No MGH Person will have any liability for any failure or delay in performing the role as a trustee because of an event beyond our reasonable control.
  16. Limitation: To the maximum extent permitted by law, the liability of the MGH Trustee arising out of or in connection with any trusteeship is limited to the value of the fees paid to Malloy Goodwin Harford for the MGH Trustee acting as a trustee.
  17. Variations: We may vary these Terms from time to time and, if we do so, the varied Terms will appear on the website of Malloy Goodwin Harford.
  18. Notice: Notice of these Terms and any other communication pursuant to these Terms given by the MGH Trustee to one other trustee of the trust shall be deemed to be given to all trustees and you will be responsible for notifying and procuring compliance with these Terms by the other trustees.
  19. Benefit: For the purposes of the Contract and Commercial Law Act 2017, these Terms confer rights and benefits upon each MGH Person (including all indemnities and limitations and exclusions on liability) and these MGH Persons shall have the right to rely on such rights and benefits as if they were a party to these Terms.